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8/14/2019 At Capital Weekly 4 January 2009
1/20
4January20
EDITORS
Ifty Islam
Managing [email protected]
Syeed [email protected]
Jisha SarwarSenior Research [email protected]
Asian TigerCapital Partners
UTC Building, Level 168 Panthapath, Dhaka-1215BangladeshTel: 8155144, 8110345
Fax: 9118582www.at-capital.com
Asian
TigerCapitalPartners
AsianTigerCapitalPartners
AsianTigerCapitalPartners
Asian
TigerCapitalPartners
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Keythemesinthis
BangladeshOvBangladeshOveBangladeshOvBangladeshOve OnDe
Sheikh
theAL Bangla govern withan
Theele
favour particip ofdem
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losing oppose
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TheNa
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econo growth domest
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HappyNewYearHappyNewYearHappyNewYearHappyNewYear!!!!
-70
-60
-50
-40
-30
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09AT CAP
ATCapitalWe
issueare:
rview: rview: rview: rview: 29
th,Bangladeshsawahistoricallysignificantelection.
HasinaWajedsecuredalargeparliamentarymajority
on230seatsonitsown(upfrom62in2001)withanoth desh Nationalist Party (BNP), more of whose leaders ents anti-corruption drive, was left with only 29 seats
other2wonbyitsally,Jamaat-e-Islam.
ctorateappearedtoresoundinglyrejectthepoliciesofthe of change. There was a record turnout of youth as wel ationrateof85%,one ofthehighestseengloballyanda
cracyinBangladesh.
imeofwriting,therearesomeencouragingsignsthatB NPsrejectionofthelegitimacyandfairnessofthepoll dtoareturntotheconfrontationalpoliticsofstreetprotest
Esawastrong rallyon thebackof theelection results. e of thebestperformersglobally.However,whilewe e
g to pick up with a return to democracy, the negativ ystillpointtotherisksof asignificantBangladeshslow onBangladeshiequitiesisstillwarranted.
tionalCoalPolicyneedstobeadoptedbythenewgover projectatPhulbarineedstobeapprovedinordertotackl
o review trends in theTelecomssector in 2008and the MAXin2009.
: : : : eterof theglobalnatureof thedownturns isreflected
ies,Singapore,wherethegovernmentannouncedonFri forecasts for 2009to -2% after a 12.5% quarter-on-qua icproductduringthelastthreemonthsof2008.
s closeto technical recession in themanufacturing indu e manufacturing index has now been registering contr .Wediscuss the impactofaslowdown in theoneecon
eUSslowdown.
DSEDSEDSEDSEOneofthebestperformingmarketin20Oneofthebestperformingmarketin20Oneofthebestperformingmarketin20Oneofthebestperformingmarketin20
DGEN
BSESENS
EX
KSE100
VNI
ndex
S&P500
FTSE100
-5.5%
-50.9%
-60.8% -66.8%
-35.4%-29.4%
-42.
YTD performance of Major Stock Indices
ITAL RESEARCH
eklyUpdate
TheAwamiLeagueledbyutofatotalof300seats,
er32wonbyitsallies.The ere targets of the interim
(down from 193 in 2001),
2001-2006BNPregimein l as female voters amid a
testamenttothevibrancy
gumKhaledaZiaandthe eemtobefadingawayas
sseeninthepast.
Indeed,at-7%in2008,it pectdomestic investment
headwinds in the global downin2009.Adefensive
nmentASAPandtheAsia theenergycrisis.
prospects for theGP IPO
in one of themost opendaythatitwasslashingitsrterestimatedfallingross
stryonthebasisthattheir ction for five consecutive omy thatwasexpected to
08 08 08 08
NIKKEI22
5
ShaghaiC
omposite
%
-65.4%
8/14/2019 At Capital Weekly 4 January 2009
2/20
4January2009 AT CAPITAL RESEARCH
_______________________________________________________________________________________ATCapitalWeeklyUpdate 2
Contents Page
BangladeshOverview 3OverwhelmingAwamiLeagueVictoryunderlinesexpectationsforchange 3
DSEoneofthebestperformingmarketsin2008;but2009maybemorechallenging 4
AvoidingPoliticizationofEnergyPolicyDecisionscritical,especiallyonCoal 5
BangladeshTelecomssector2008Review/2009Outlook 5
TelecomsReviewof2008 5
TelecomscompanieshitbyVOIPfines 5
GrameenphoneIPO,de-railedbyshareholderdispute,slimmeddownbutbackontrack 5
ThreeWIMAXlicensesauctioned 6
TelecomProspectsfor2009 6
OtherProspectiveIPOs 7
TelecomsSectorDataAppendix 8
GlobalMarketsOverview 9GlobalManufacturingDownturnIntensifies 9
ChinaManufacturingTechnicallyinRecession? 9
WeekinReviewEnd-2008RallyinCommoditiesandRiskAssets
10
StockMarketWeekly
11
StockMarketNews 12
Economics 14EconomicsNews 15
SectorNews 16Agriculture/Aviation 16
Banking 17
Healthcare/Infrastructure&energy 18
Pharmaceuticals/Telecoms/Textiles/Tourism 19
8/14/2019 At Capital Weekly 4 January 2009
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4January2009
________________________________ATCapitalWeeklyUpdate
BangladeshOverviewBangladeshOverviewBangladeshOverviewBangladeshOverviewOverwhelming Awami League Victory Overwhelming Awami League Victory Overwhelming Awami League Victory Overwhelming Awami League Victory expectationsforchangeexpectationsforchangeexpectationsforchangeexpectationsforchange
The Economist stated in its Jan 2 issue tha Bangladeshelections wentbetter thananyone Indeed, with an extraordinary turnout rate organized, peaceful and transparent voting countrysfirstelectioninsevenyearson29
thDe
was perhaps the most credible one since t Independence in1971. TheAwamiLeagueAll Sheikh Hasina, who was Prime Minister fromwon a grand victory. The League secur parliamentarymajority Outof a total of 300s won230seatson itsown (up from62 in2001) 32wonbyitsallies.TheBangladeshNationalist more of whose leaders were targets of governments anti-corruption drive, was left seats(downfrom193in2001),withanother2w
Jamaat-e-Islam.Acomputerizedphotovoter l istwas introduced time,and81mngenuinevoterswereregistered. the UNDP, an independent audit of the Washington-based International Foundation f Systems (IFES) concluded that the listwasco highdegreeofaccuracy,andnoghostvoters
230
2927
32
21 14
1
Election 2008
Awam
BNP
Jatiya
JSD
Worke
Jamm
ElectionStatisticsElectionStatisticsElectionStatisticsElectionStatistics
BangladeshNat ionalist
BangladeshAwamiLea
Jamaat-E-IslamiBangl
JatyaParty(Ershad)
Source:BangladeshInt
AT CAPI
_____________________________________
underlines underlines underlines underlines
this years daredhope.
and a well system, the
ember2008 e countrys
iance ledby 1996-2001,
d a large eats, theAL
withanother Party(BNP), the interim
ith only 29 nbyitsally,
for the first Accordingto
list by the or Electoral
piledwitha erefound.
Analyzingthepercentageofvotesc theElectionCommission(EC)state likely to exceed 85%, a staggeri previous record, and the highest According to the secretary to the constituencies in the rural areas, t 90%; insomeconstituencies the tu inmetropolitanareas,particularly i theturnouthoweverwaslower,butPerhapsitisnotsuchagreatsurpri fromthegeneral trendof theALa powersince1991(BNPwastheruli ALfrom1996-2001;BNPfrom200slogan for Change was also well voters, especially the young and desperate toseechange and impr voters this was their first election; oncebefore,in2001.
Giventhecatastrophicscaleofthe were naturally fears of the tradit protests,generalstrikesandaboy KhaledaZiastatedintheimmediat thegeneralelectionwasstage-ma to her party. However, the Chief (CEC) confirmed that there woul quarter to reject the results of election.Accordingtohim,about1,
If
i League
Party
rs Party
t-e-Islami
193
62
17 8 6
Election
1991 1996 2001 20
Party(BNP) 140 116 193
gue 88 146 62 2
desh 18 3 17N/A N/A 14
ernationalObserverNetwork
TAL RESEARCH
________________ 3
astin299constituencies, dthattheturnoutismost g 10% higher than the
in Bangladeshs history. ECSecretariat In many
urnout is between 85 to rnout isashighas94%;
nDhakaandChittagong, above70%.
sethattheALwon.Apart d theBNPalternating in ngpartyfrom1991-1996;
1-2006),SheikhHasinas l framed at a time when first time voters, were
vement.Forone-thirdof a further 23% voted just
efeatfortheBNP.There ional response of mass
ottofparliament.Begum aftermathofresultsthat
agedarenotacceptable Election Commissioner
d be no scope for any the ninth parliamentary
00foreignand0.2mn
yIslam,[email protected]
001
BNP
Awami League
Jamat-e-Islami
Jatiya Party
Independent
08
29
30
2
27
8/14/2019 At Capital Weekly 4 January 2009
4/20
4January2009
________________________________ATCapitalWeeklyUpdate
local observersa remonitoring t hewholeelect andso, itwillbe impossible foranyone to rejec At the timeofwriting, theprospects for theBN the election results through public protests ap diminishing.The fact thatHasina has toldU.N. election ob the elections that her party will work in unis opposition in parliament to strengthen de develop t henation, i sp romising.Furthermore, herfirstpost-electionnewsconference,Hasina would share power with the opposition despit massivemajority in t hee lection,andwas rea seniorparl iamentarypost toherbitterpolitical KhaledaZia.Hasina stated, Aswinners,we with everything with a sense of forgiv accommodation insteado f vengeance, t o t ake forwardincooperationwithal lirrespectiveofpar Expectationsforthe newgovernment are very fromhopes that thenewadministrationwillmov the previous 15 years and three democratic thatwascharacterizedbyconstantpoliticalven are invested in thenew leader for tackling inflat energycrisis, climatechange, terrorism,andp economy from any major impact from t he glo crisis. Starting from businessmen to farmers expect the AL to demonstrate the changes th promised in itsmanifestos. While talking toTh theALsaidoneof the firstvital indicationsof 'c be t he f ormationo f t hecabinet, d roppingman faces' andappointingnew,honestandcompet charge of various ministries. Other things that addressed urgently i nclude keeping t he ports facilities free from politicization, encouraging f investment, creation of jobs, and appointin people to the energy ministry to strengthen t energy security. Last but not the least, one importantpre-requisites for attaining economic
attractingmoreFDIand investors, isa stable climate, withm inimal protests, s trikes and str Needlesstosay, theonlywaytoattainstabi li ty opposition party to accept the results, and operation with the ruling party in the best int country. UNSecretary-General BanK i-Moon s stablepost-electionclimatewill bevital for the and sustainability of the nationsdemocracy. political parties, irrespective of their perform elections, to work together in a spirit of d compromise, to address the challenges facing Suchcooperationshould includean enhanced oppositioninParliament.DSEoneof thebestperformingmarkets in20 DSEoneof thebestperformingmarkets in20 DSEoneof thebestperformingmarkets in20 DSEoneof thebestperformingmarkets in20 maybemorechallengingmaybemorechallengingmaybemorechallengingmaybemorechallenging
The DSE ended 2008 down 7.1% after the d gain in 2007. However the absolute returns strongperformance in thecontextof themost market seen since the great depression ami financialcrisis.
AT CAPI
_____________________________________
ion process, t theresults.
Pcontesting pears to be
servers after on with the
ocracy and speaking at
aidthatshe e winning a y to offer a
rival,Begum ave to deal
eness and the country
tyaffiliation.
high apart eawayfrom overnments detta,hopes
ion,poverty, rotecting the bal financial
, the public at the party eDailyStar,
ange'would of the 'old
ntpeople in need to be
of economic oreign direct
competent he country's
of the most growth and
ost electionet violence. i llbeforthe work in co- erest of the
tated thata ffectiveness
e urged all ance in the ialogue and
the nation. role for the
8;but2009 8;but2009 8;but2009 8;but2009
amatic 91% ask a very severe bear the global
Asthechartbelow illustrates,the best performing stockmarkets in t relativebasiswhencompared to d 67% inVietnam,51% in India,75 theS&P500.
However, as the next chart illus Bangladeshat17.1timeslookquit its EM peers such as India, Paki IndeedeventheUKstockmarketlo Ultimately,akeyconsiderationinas ofcurrentlevelsfortheDSEcomes
oftheBangladesheconomytothe as strected valuations. On the expectation that weak domestic i has been held back by the anticaretaker government period is li corporates regain an appetite to i hand, as we discus in more deta sectionofthisissue,thestormclou continue to darken with the Chine technically in recession and Sing contractby2%in2009.Onbalance
-70%
-60%
-50%
-40%
-30%
-20%
-10%
0%
DGEN
BSESENSEX
KSE100
VNI
ndex
-5.5%
-50.9%
-60.8%-66.8%
-3
YTD performance of Ma
14.4%
103.8%
-16.1%
-40%
-20%
0%
20%
40%
60%
80%
100%
120%
2003 2004 2005
DSE General Index
TAL RESEARCH
________________ 4
SEhasbeenoneofthe he world in 2008 pm a eclines of 65% inChina,
inRussiaand35% for
trates, the PE ratio of erichrelative tomanyof
stan, China and Russia. ksrelativelycheap.
sessingthesustainability downtothevulnerability
lobalslowdownasmuch one hand, there is an
vestment spending that -corruption drive of the
ikely to pick up as BD invest. But on the other
il in the Global Markets sfortheglobaleconomy se manufacturing sector apore now expected to
,wecontinuetobelieve
S&P500
FTSE100
NIKKEI225
ShaghaiComposite
.4%
-29.4%
-42.1%
-65.4%
or Stock Indices
3.6%
90.6%
-7.1%
2006 2007 2008
eturn (%)
8/14/2019 At Capital Weekly 4 January 2009
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8/14/2019 At Capital Weekly 4 January 2009
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_______________________________________________________________________________________ATCapitalWeeklyUpdate 6
ii)MoreOverseasDemand:ii)MoreOverseasDemand:ii)MoreOverseasDemand:ii)MoreOverseasDemand:ItwasalsopotentiallyacatalystforgreaterliquidityinthemarketandcriticallymoreoverseasinvestorinvolvementintheBangladeshstockmarket.Largerforeign investment companies have for some time beenwaitingforsizeableandliquidissuestoinvestin.However, optimism for a smooth IPO process wasundermined by an increasingly frictional and contentiousdispute between the two main shareholders, Telenor ofNorwayandGrameenTelecom.ProfessorYunus,thenobel-prize-winningheadofGrameen.Among other comments, the Professor Yunus statedSeptember 4 that: "The recent activities (of Telenor-controlledmanagement) inBangladeshleavemewith littlealternativeother thanto investigate thepossibilityof takinglegal action. He softened his stance on September 5 bystatingalawsuitwasonlya"remotepossibility(andthat)thisis not an outcome that we think is necessary...I t is apossibility,aremotepossibilityWearenotthekindofpeopletorushtothecourts."Dr.YunuscontinuestoclaimthatTelenorrefusedtohonouranagreementsealedin1996totransferitsmajorityholdingtohisGrameenTelecomby2002statingthat:"Backin1996,Telenorandweagreedthatthejointcompanywithinsixyearsshould bea locallyoperated companywithBangladeshi management and Bangladeshi majorityownership. This has not happened Telenor now tellsmethat it was amistake to rely on their words. We now arebeingtoldthatthewordsofthewrittenagreementina legalsense are non-committing statements. We relied on thewordsoftheagreement."Telenor, however, has its own interpretation of the 1996partnership deal. The company stated that "In the conflictregarding the ownership of Grameenphone, Telenordisagrees with Muhammad Yunus that we have an
agreement to sell our stake in the company to him Wewould like to emphasise that the shareholder agreementclearly states that any disagreements should be resolvedthroughtheSwedishcourts."What is more concerning is that this is not an isolatedargumentordisagreement.InanAssociatedPressReportinDecember 2006, it was reported that Norway's Telenorrejectedanoffer to sell control ofGP topartnerGrameenTelecom,sayingitsstrategyistoownmajoritystakesinjointventures.NewspaperDagbladetquotedMuhammadYunus,assayingGrameenTelecomwasreadytoofferTelenorNOK2.6bn(USD426.9mn)tobuya13%stakeinGrameenphoneandgainamajority.One would be hard pressed to come up with a more
potentially damaging and confusing issue ahead of theproposedIPO.ReportsofProfessorYunuscommentshaveappearedinasdiversea rangeofmediaasBloomberg,theGuardian in the UK and Reuters, as well as extensivecoverage domestically. A public dispute between the twomain shareholders ahead of an IPO is pretty muchunprecedented indevelopedmarkets,especiallyfor such alargecompanyoffering.ItwaslikelythedisputeratherthandeterioratinginternationalmarketsthatsawthedelayoftheIPOandthemoveaway
from international investorparticipation tosoleyadomesticone.Thecompany,laterinOctober,saiditplannedIPOto$125 million -- half from stock market and rest throughprivateplacement.In theevent,in December, Grameenphone Ltd. closed themarketing of a pre-IPO private placement of its sharesamounting to US$60 million (BDT 413 crore) to localinstitutionalinvestorsonDecember4,2008.The companyreported that the pre-IPO placement offer was over-subscribedbythreetimesdueto strongsupportfrommorethan50localinstitutionalinvestors.Inthepre-IPOoffer,thecompany raised a total ofUSD 60 million at BDT 7.4 pershare, which was increased from earlier size due to thestrong demand. Grameenphone Ltd. has filed its finalapplicationforaninitialpublicoffering(IPO)ofUS$65million(BDT 449 crore) with the Securities and ExchangeCommission (SEC) today (December 11, 2008).Grameenphone'sBoardofDirectorshadearlierapprovedaproposal for an IPO of its shares, subject to necessaryapprovalsandmarketconditions.ThepricefortheIPOhasbeenproposedatBDT7.00,subjecttoSECapproval.ThreeWIMAXlicensesauctionedThreeWIMAXlicensesauctionedThreeWIMAXlicensesauctionedThreeWIMAXlicensesauctioned
InSeptember,Augere,BanglaLionCommunications,BRACBDmail Network Ltd won licences for establishment,operation andmaintenance of broadbandwireless accessservices through WiMAX (worldwide interoperability formicrowaveaccess)technologywhichallowswirelessdatatotravel overlongdistancesby variousmeans,frompoint-to-point linksto fullmobile cellular type access.The licenseswereauctionsforarecordBDT215Crore($31mn)versusthepreviousrecordofthepreviousrecordforWiMAXlicensefee was inSingapore (18 millionDollar). According to thelicence conditions, the winnerswere required to set upatleast90basestationsinthefirstyearandtheentirecountrywillneed tobebroughtundertheWiMAXnetworkin threeyears. The licence acquisition fee, set by the commission
auction,willbesupplementedbyanannuallicencefeeofTk3crore.Eachofthecompanieshavebeenallotedachunkof35MHzfrequencytooperate.Mobilephonecompanieswerebarredfromparticipatingintheauctions.IntheeventBracnetwasunabletoraisesufficientfundstotakeuptheWimaxlicenseandthenextthreebidderswerealso unwilling to commit. As a result, Mango Teleserviceshavedecidedtotakeupthelicense.TelecomProspectsfor2009TelecomProspectsfor2009TelecomProspectsfor2009TelecomProspectsfor2009OntheGP IPO,we believe, that the proposedprice ofTk7.00 looks fair relative to the original expectations ofseventeentimesfacevalueandanumberofotherissuesinthemarketplace.Thedecline inAsianTelecomsvaluations
hasalsoseenGPreducetheirownpriceexpectations.Whilethe valuation relative to Indian Telecoms issues lookssomewhatontherichside,itmightbearguedthatGPsmarketdominance isunlikelyto bechallenged by thenextmajor players such as Banglalink, AKTEL, Warid andCitycell.Indeed,itseemsunlikelythatthemarketcansustainso many Telecoms operators and some degree ofconsolidationseemslikely.OnepotentialcatalystforgreatercompetitionintheTelecomssectormightbetointroducetheportabilityofnumbersthatmightdiminishthefirst-mover
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_______________________________________________________________________________________ATCapitalWeeklyUpdate 7
advantagesGPhasovertthenewerarrivals.Thebiggestuncertaintiesabout the longerprospects forthe GP issuesareprimarilyontheissueoftheirabilitytoexpandValueAddedServices(VAS)toarrestthedeclineinARPUaswellas any prospective shifts in the regulatory environment.Whilethereisnothingonthehorizon,theeventsof2008withrespecttoVOIPfines,Wimaxlicensesandsoon,allsuggesta more activist regulator in Bangladesh than some othercomparableEMtelecomsmarkets.Itisalsoimportantfortheliquidityofthe GP issues toattractmore foreign investors.Another uncertainty is the likely stance of the newgovernmentonthelevelofSIMcardtaxation.Over thelonger-term,amajorbattlegroundin theTelecomssector,giventhecut-throatnatureofpricecompetitioninthevoicemarket,is whetherGPsGPRS data service and thecompetinginternetservicesfromBanglalinkandAKTELcancontinueto grow intheface oftherollout ofWIMAX. Oneschoolofthoughtisthatas3GisintroducedinBangladesh,thatTelecomsplayerslikeGPwillremaincompetitiveversusWIMAX given the proliferation of 3G handsets and theprospectsforfurthercostreductionandpricingof future3Gcompatiblehandsets.Ontheotherhand,webelievethatthepopulation density of Bangladesh makes it attractive forWIMAX players to be able to aggressively price theirbroadband offerings, particularly if, as we expect, BTRCmaintainspressureonBTCLtocontinuetocutthewholesalepriceofinternetbandwidthoverthecourseof2009.Thebigmarket opportunity for WIMAX is for greater broadbandpenetration and the proliferation of more laptops and PCsamong a newer generation of internet-hungry consumerswhodonotwanttobelimitedtohandset-basedemailusagebut rather wish to take upa broader rangeofweb-basedcontentthatismoresuitedtocomputerusage.Onbalancewe believe WIMAX will prove to be a more seriouscompetitor for the exisiting Telecoms players than isassumed by the current consensus given well capitalizedoverseasplayerssuchasAugereandotherpartneringwith
thelocalcompaniesthatcancross-fertilizetheirexperienceofWIMAXrolloutsinotherEMcountries.ThesuccessofGPVAShasbeensomewhatlimitedtodatewithinitiativeslikeCellBazaarmobilemarketplace.Buttheywillneedtomaintainsupportandinvestmentforthecreationofabroaderrangeofphone-baseddataapplicationsif theyaretolimitfurthersharpdeclinesinARPU.The30%stakeinAKTEL taken by NTT Docomo, the leading JapaneseTelecoms company, might also see GP face majorcompetitive threats when 3G rollout occurs given theJapanese companies acknowledged expertise in 3G/4Gtechnologies.SomeotherpotentialTelecomsissuesinclude: Mobilebankingandpayments
Mobile payments have significant potential in cash-basedeconomysuchasBangladesh User familiarity with stored-value usage of cell
phones(e.g.Flexiload) In various other developing countries similar to
Bangladesh(e.g.Philippines,SouthAfrica),stored-value in cell phones is widely used to makepaymentstovendorsinlieuofcash
Mobile banking presents a compelling opportunity in thefollowingareas:
Electronicremittance:$8bninannualremittancesto
Bangladesh
Financial products (e.g. savings account,insurance)targetingalarge,under-bankedsegmentofpopulationwhodependonremittances
Mobilecontentandadvertising
Mobilegamingpresentcompellingopportunitygivenyouthfulsubscriberbase Mobile advertising has a captive user base of
~50mm:morethanmostothermedium Callcenters
Growing telecom infrastructure, low cost of laborandEnglish proficiency cansupport growth of IT-enabledservices/BPOsector
Upside to telecom services provider capable ofdeliveringthebandwidthandservices
OtherProspectiveIPOsOtherProspectiveIPOsOtherProspectiveIPOsOtherProspectiveIPOsApart fromGrameenphone& Aktel IPO, there isat least 9moreprospectiveIPOscominginthenextthreeyears:
ICXIPOs:CurrentlyotherthanstateownedBTCL,therearetwointerconnectionexchangecompaniesoperatingin the country. They are Getco TelecommunicationsLimited & M & H Telecom. According to licensingrequirement,theyhavetooffloadtheirshareinthelocalstockmarket within 3 years of the commencement oftheirbusiness.
IGWIPOs:Currently3internationalgatewaycompaniesoperatingin thecountry other thanstateownedBTCL.They are Bangla Trac Communications Limited, MirTelecom& NovoTelLimited.TheyalsohavethesamelicensingrequirementforoffloadingIPOwithin3yearsofoperation.
WiMax IPOs: 3 companies were selected to provideWiMax service in the country. The companies areAugere Wireless Broadband Bangladesh Limited &
BanglaLion Communications limited and MangoTeleservices. These companies will have to come upwithIPOwithin3yearsoftheiroperation.
OtherthantheseIPOs,stateownedBTCLmightcomein the stock market, because govt. has alreadyexpresseditsintentiontosell100%ofBTCLshare.Butyettheyhavenotformulatedthewayhowtheyaregoingto offload those shares. Moreover, we believe onceGrameenphone & Aktel will be listed, there will be aregulatorypressureonothermobilephoneoperatorstooffload their share in local stock exchange. So theymight alsoget listed innext threeyears time.Sotheirwill be a series of listing from the telecom industryofBangladeshincomingyears.
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________________________________ATCapitalWeeklyUpdate
TelecomsSectorDataAppendixTelecomsSectorDataAppendixTelecomsSectorDataAppendixTelecomsSectorDataAppendix
GrameenphoneGrameenphoneGrameenphoneGrameenphone BBBBStartofOperationStartofOperationStartofOperationStartofOperation 1997
OwnershipOwnershipOwnershipOwnership Telenor62%
GrameenTelecom38%
SubscriberSubscriberSubscriberSubscriber 20.84mn
(asofJuly2008)(asofJuly2008)(asofJuly2008)(asofJuly2008)
MarketShareMarketShareMarketShareMarketShare 46.50%
NetsubscriberNetsubscriberNetsubscriberNetsubscriber 5.7mn
Addition(2007)Addition(2007)Addition(2007)Addition(2007)
ChurnChurnChurnChurn
MarketShareofMarketShareofMarketShareofMarketShareof 43.47%
netadditionnetadditionnetadditionnetaddition
AMPUAMPUAMPUAMPU
ARPUARPUARPUARPU 4.13
(Q108USD)(Q108USD)(Q108USD)(Q108USD)Revenue(2007)Revenue(2007)Revenue(2007)Revenue(2007) 793.1
EBITDA(2007)EBITDA(2007)EBITDA(2007)EBITDA(2007) 389.7
BTS(EOY2007)BTS(EOY2007)BTS(EOY2007)BTS(EOY2007) 5,700
FrequencyFrequencyFrequencyFrequency 14.6MHz
(AsofAug08)(AsofAug08)(AsofAug08)(AsofAug08)
10.4421.204
34.37 42.0450
020406080
Mobile Phone Subscribers Banglades
(mn)
AT CAPI
_____________________________________
anglalinkanglalinkanglalinkanglalink AktelAktelAktelAktel CityCellCityCellCityCellCityCell WaridWaridWaridWarid1997 1997 1993 2007
rascom100%
TelekomMalaysia70%
DhabiGroup
NTTDoCoMo30%
100%
9.9mn 7.98mn 1.67mn 3.48mn
22.10% 17.80% 3.70% 7.80%
4.38mn 0.6mn 0.31mn 2.15mn
33.42% 4.58% 2.36% 16.40%
2.8
193 210.2
-42 63.3
3,200 3,905
12.4 12.8MHz 10MHz 15MHz
60 70
h
7.3%
14.5%
23
0%
10%
20%
30%
2005 2006 2
Mobile phone penetration
Bangladesh(%)
TAL RESEARCH
________________ 8
TeletalkTeletalkTeletalkTeletalk2005
100%ownedby
BangladeshGovernment0.93mn
2.10%
-0.03mn
-0.23%
15.2MHz
.1%
27.4%
07 May 2008
in
8/14/2019 At Capital Weekly 4 January 2009
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_______________________________________________________________________________________ATCapitalWeeklyUpdate 9
GlobalMarketsGlobalMarketsGlobalMarketsGlobalMarketsOverviewOverviewOverviewOverviewGlobalManufacturingdownturnintensifiesGlobalManufacturingdownturnintensifiesGlobalManufacturingdownturnintensifiesGlobalManufacturingdownturnintensifiesThe JPMorgan Global Manufacturing PMI hit 33.2 inDecember,aseriesrecord.Moretothepointyoucangetacomparison betweenwhat ishappening nowand the2001
"recessionlite"withonlyaswiftglance,and,ofcourse,the2009 long recession is only just getting started. Someforecasts are predicting that Global Steel Output coulddecline13%ormorein2009,theworstsinceWorldWarII.TheGlobalManufacturingInputPricesIndexposted31.3,itslowest ever reading. The rate of deflation was especiallymarkedintheUS,werepurchasepricesfelltothegreatestextentsinceJune1949.
A barometer of the global nature of the downturns arereflected in two major trading economies, Singapore andJapan. Singapore's government announced Friday that itwas slashing its growth forecasts for 2009 after a 12.5%quarter-on-quarterestimated fall in gross domesticproductduringthelastthreemonthsof2008.Thecontractionwasfarsharperthanthe-3.4%expectedbyeconomists,andasoneof the first economies inAsiato postresults for the fourthquarter, the data poses worrying signs for the rest of theregion.
Singapore officially fell into recession back in October, asdecliningdemandfromkeycustomersliketheUnitedStatesandEuropebegantohurtexports,butthespilloverintothecity-state's wider economy has intensified since then. Theslumpinmanufacturingandfinancialservicesisnowstartingtoaffecttheservicesindustry,withthelatestestimatesfromthesectoronFridayshowingyear-on-yeargrowthat1.1%--downfrom5.3%inthepreviousquarter.
Singapore'sMinistry of Trade and Industry said there hadbeena "collapse"inworldtradeandwarnedthattheknock-on effects would continue into 2009. Property, retail andbusiness services were al l expected to suffer. ThegovernmentnowexpectsGDPtocontract2%in2009.
Analysts from Barclays Capital expect Japan to post anannualized 12.1% drop in gross domestic product for thefourth quarter of 2008, which would be the sharpestcontractionin34years.ChinaManufacturingTechnicallyinRecession?ChinaManufacturingTechnicallyinRecession?ChinaManufacturingTechnicallyinRecession?ChinaManufacturingTechnicallyinRecession?CLSA Asia-Pacific Markets, who compile the ChinaPurchasingManagersIndex,have suggestedthatChina is"close to technical recession inmanufacturing industry"onthe basis that their Chinese manufacturing index has nowbeenregisteringcontractionforfiveconsecutivemonths.
Chinas composite manufacturing index contracted for thefifth consecutive month inDecember as recessions in theU.S.,EuropeandJapanbit deep into demandfor exports-indeedChina'sexportsfellyearonyearforthefirsttimeinseven years in November. The CLSA China PurchasingManagers Index registered a seasonally adjusted 41.2,compared to a record low of 40.9 in November. On suchindexesanyreadingbelow50reflectsacontraction.Prof Nouriel Roubini of New York University in a recentarticle in the Asia-Pacific Journal has underlined the highprobabilityofahardlanding.HenotesthatInacountrywiththepotentialgrowthofChina,ahardlandingwouldoccurifthegrowthrateoftheeconomyweretoslowdownto5-6%asChinaneedsagrowthrateof9-10%toabsorbabout24million folks joining the labor force every year; it needs agrowthrateof9-10%tomoveeveryyearabout12-14millionpoor rural farmers to the modern industrial/manufacturingurbansector.Thewholesocialandpoliticallegitimacyoftheregimeof the rulingCommunistpartyrestsoncontinuingtodeliverthishighgrowthgreattransformationoftheeconomy.Thus,aslowdownofgrowthfrom12%to5-6%wouldbetheequivalent ofa hard landingora recession forChina.Andnow a variety of macro indicators suggest that China is
indeedheadedtowardsahardlanding.ProfRoubinigoesontonotethatChinaisaneconomythatisstructurallydependenton exports:netexports(or thetradebalance surplus) are close to 12% of GDP (up from 2%earlier in thedecade)and exports represent about 40%ofGDP.Real investmentin China isabout45% ofGDPand,leavingasidethepartofthisinvestmentthatishousingandinfrastructure spending, about half of this capex spendinggoes towards the production of new capital goods thatproduces more exportable goods. So, with the sum ofexports and investment representing about 80% of GDP,most of the Chinese aggregate demand depends on itsabilitytosustainanexportbasedeconomicgrowth.The trouble, however, is that the main outlet of Chinese
exportstheU.S.consumerisnowcollapsingforthefirsttime in two decades. Chinese exports to the U.S. weregrowingatanannualizedrateofover20%ayearago,whilethemostrecentbilateraltradedatafromtheU.S.showthatthisexportgrowthhasnowfallento0%.Buttheworstisstilltocomeinthenextfewquarters:afteranoksecondquarterintheU.S.(boostedbythetaxrebates)U.S.retailershopedthat the consumer downturn would be minor: they thusplaced over the summermassive orders for Chinese (andotherimported)goodsforQ3andQ4.ButnowtheU.S.
Source:JPMorgan
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________________________________ATCapitalWeeklyUpdate
StockMarketWeeklyStockMarketWeeklyStockMarketWeeklyStockMarketWeekly
MarketMarketMarketMarketssssummaryummaryummaryummary
DSEDSEDSEDSEpppperformance:30erformance:30erformance:30erformance:30ddddaysaysaysays
DSEDSEDSEDSEpppperformance:erformance:erformance:erformance:52w52w52w52weekseekseekseeks
13.0
13.5
14.0
14.515.0
15.5
10-Nov-08
12-Nov-08
16-Nov-08
18-Nov-08
20-Nov-08
24-Nov-08
26-Nov-08
30-Nov-08
2-Dec-08
4-Dec-08
15-Dec-08
18-Dec-08
22-Dec-08
24-Dec-08
MarketCap.
inU
SDBn
MarketCap. Turnover
IndexperformanceDSEGeneral
Index
Openingofthisweek 2,630.1
Closingofthisweek 2,807.6
Changewithinaweek(%) 6.7%
Changewithinaweek(Point) 177.5
CapitalizationandturnoverThis
Week
NumberofTradingDays 3
MarketCapitalization(USDbn) 15.30 1
TotalTurnover(USDmn) 168
DailyAvg.Turnover(USDmn) 56
TotalVolume(mn) 83DailyAvg.Volume(mn) 28
Weightedavg.P/ERatio*
Issues
ThisWeek 18.1 Advanced
LastWeek 17.2 Decl ined
%Change 5.31% Unchanged
*WeightedonMarketCap. NotTraded
AT CAPI
_____________________________________
ValuationsnapshotValuationsnapshotValuationsnapshotValuationsnapshot
RegionalRegionalRegionalRegionalstockmarketperforma stockmarketperforma stockmarketperforma stockmarketperforma
MarketMarketMarketMarketnnnnewsewsewsews
Trading of Maksons Spin Trading of Maksons Spin Trading of Maksons Spin Trading of Maksons Spin
beginbeginbeginbeginsssson1on1on1on1stststst
January2009January2009January2009January2009 DSEsixthbestperformingDSEsixthbestperformingDSEsixthbestperformingDSEsixthbestperforming
worlduntilNovemberworlduntilNovemberworlduntilNovemberworlduntilNovember
10
20
30
40
50
-
ec-
TurnoverinU
SDM
n 6.7%
2.0%
6.2%
--15%
-10%
-5%
0%
5%
10%
DSE20
2,196.2
2,316.5
5.5%
120.4
Lasteek
%Change
4
4.49 5.57%
78 116.8%
19 189.0%
67 23.9%17 65.2%
ThisWeek
LastWeek
196 221
39 27
8 6
36 52
Aug-08 Se
Banks 19.08
Cement 10.96
Ceramic 49.92
Engineering 39.11
Food&Allied 17.85
Fuel&Power 17.81
Insurance 23.17
Investment 45.08
IT 41.44
Jute 16.16
Miscellaneous 25.46
Paper&Printing 8.36
Pharmaceuticals 23.97
Service&RealEstate 20.57
Tannery 19.05
Textiles 15.74
So
TAL RESEARCH
________________ 11
ce(lastweek) ce(lastweek) ce(lastweek) ce(lastweek)
ning, National Housing ning, National Housing ning, National Housing ning, National Housing
stockstockstockstock exchangein theexchangein theexchangein theexchangein the
1.3%
DGEN, Dhaka
CASPI, Chittag
ng
BSE
Sensex, Mum
i
KSE100, Karac
SectorP/E
p-08 Oct-08 Nov-08
8.24 15.62 15.62
0.34 10.32 8.91
3.93 41.76 32.17
1.36 40.8 31.94
9.44 17.09 14.77
20.2 19.14 16.29
4.77 23.12 17.69
5.48 28.93 21.42
5.64 47.89 33.96
6.16 14.18 14.18
3.95 32.2 23.32
8.08 9.97 7.32
8.45 30.25 26.26
2.87 23.55 18.74
9.89 18.44 14.87
5.45 14.55 12.43
rce:DhakaStockExchange
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StockMarketStockMarketStockMarketStockMarketNewsNewsNewsNewsTradingofMaksonsSpinning,NationalHousingbeginTradingofMaksonsSpinning,NationalHousingbeginTradingofMaksonsSpinning,NationalHousingbeginTradingofMaksonsSpinning,NationalHousingbeginsssson1on1on1on1
ststststJanuary2009January2009January2009January2009TheFinancialExpress,WednesdayDecember31,2008
Maksons Spinning Mills Limited and National HousingFinanceandInvestmentLimitedstartedtradingontheDhakaStockExchange(DSE)andtheChittagongStockExchange(CSE)from1
stJanuary2009.
Maksons Spinning floated 8mn ordinary shares at a facevalueofBDT10(US14.52Cents)each,raisingBDT80mn(USD1.16mn)fromthestockmarket.Thepaid-upcapitalofthecompanywasBDT340mn(USD4.94mn)asofApril26,2008.MaksonsSpinningisthe40thlistedtextilecompanyonDSE.The National Housing Finance and Investment Limitedfloated 0.5mnordinary shares ata facevalue of BDT100(USD1.45)each,raisingBDT50mn(USD0.73mn)fromthestockmarket.Thepre-IPOpaidupcapitalwasBDT400mn(USD5.81mn)asofDecember31,2007.http://www.thefinancialexpress-bd.com/search_index.php?page=detail_news&news_id=54636DSEsixthbestperformingDSEsixthbestperformingDSEsixthbestperformingDSEsixthbestperformingstockstockstockstockexchangeintheworlduntilexchangeintheworlduntilexchangeintheworlduntilexchangeintheworlduntilNovemberNovemberNovemberNovemberTheFinancialExpress,TuesdayDecember30,2008
While globallymost stockmarkets havesuffered from thefinancialcrisis,DhakaandChittagongstockexchangeshaveperformedreasonablywellin2008.AccordingtoBloomberg,during the first eleven months of 2008, the Dhaka StockExchange (DSE) was the sixth best performing stockexchangeintheworldonacurrencyadjustedbasis.Duringthefirsthalfoftheyear,thestockmarketperformedwell. The rise in the indices were dr iven by strong
performancefromthebanksimpressiveyearlyresults.However, stock prices declined in the second half of theyear. The weaknessduring thesecond halfwas driven bypullout from retail investors worried about foreign portfolioinvestorswithdrawingastheydidinRussia,India,China,etc.Additionally,theuncertaintyaboutthepoliticalsituationalsodiscouragedsignificantinflowintothemarket.However,themarketrecuperatedinDecember2008.http://www.thefinancialexpress-bd.com/search_index.php?page=detail_news&news_id=54513
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ResearchTeamResearchTeamResearchTeamResearchTeam
Ifty Islam
Managing Partner
Syeed Khan
Partner
Mohammad Emran Hasan
Senior Associate
DGENPerformanceYTDDGENPerformanceYTDDGENPerformanceYTDDGENPerformanceYTDDGENPerformanceLTMDGENPerformanceLTMDGENPerformanceLTMDGENPerformanceLTM
Correlationwithotherindices*
S&P500 Sensex NIKKEI225 KSE100 SSECI FTSE100 Hangseng DSE
S&P500 1.00
Sensex 0.52 1.00
NIKKEI225 0.41 0.53 1.00 KSE100 0.16 0.32 0.15 1.00
SSECI 0.24 0.36 0.20 0.06 1.00
FTSE100 0.81 0.53 0.44 0.24 0.34 1.00
Hangseng 0.65 0.62 0.48 0.13 0.45 0.74 1.00
DSE 0.07 0.12 0.05 0.02 0.02 0.08 0.09 1
*Basedonthelast83monthsUSDreturnsSource:ATCapitalResearch
Marketcap.bysector*
Banks 51.0%Fuel&Power 13.8%
Pharmaceuticals 11.6%
Insurance 5.5%
Cement 5.1%
Miscellaneous 3.0%
Engineering 2.4%
Foods 2.1%
Textile 1.9%
Service&RealEstate 1.2%
Tannery 1.2%
Ceramics 0.7%
IT 0.5%
Paper&Printing 0.1%
Jute 0.03%Total 100%
*AsofNovember ,2008
2,400
2,6002,800
3,000
3,200
3,400
Jan'08
Feb'08
Mar'08
Apr'08
May'08
Jun'08
Jul'08
Aug'08
Sept'08
Oct'08
Nov'08
Dec'08
2,200
2,4002,600
2,800
3,000
3,200
14-Jan-08
29-Jan-08
12-Feb-08
27-Feb-08
12-Mar-08
30-Mar-08
13-Apr-08
28-Apr-08
13-May-08
28-May-08
11-Jun-08
25-Jun-08
10-Jul-08
24-Jul-08
7-Aug-08
25-Aug-08
8-Sep-08
22-Sep-08
14-Oct-08
28-Oct-08
11-Nov-08
25-Nov-08
18-Dec-08
Turnoverleaders
(Allfiguresinmn) BDT USD
Beximco Pharma 1028 14.9
SummitPower 891 12.9
TitasGas 734 10.7
GrameenOne:Scheme2 480 7.0
BEXIMCO 461 6.7ACIFormulationLimited 448 6.5ShinepukurCeramicsLimited
4166.0
ACILimited 372 5.4
NBL 356 5.2
UttaraBank 255 3.7Source:DhakaStockExchange
Bestperformers* Worstperformers*
%Change %ChangeSamata Leather 27.4% ShaympurSugar -11.6
Olympic Industries 23.1% RenwickJajneswar -11.6
Bangladesh Online 21.2% MeghnaCondensed -11.1
BDCOM Online Ltd. 20.9% EasternLubricants -10.3
Summit Power 20.4% BanglaProcess -9.0Aims 1st M.F. 19.3% ZealBanglaSugar -7.8
Grameen Mutual One 18.7% MeghnaPet -7.0
CMC Kamal 17.5% DulamiaCotton -5.6
BCIL 17.3% PerfumeChemicals -5.2
Beximco Synthetics 16.9% DhakaFisheries -4.2
*ByclosingpriceSource:DhakaStockExchange
Marketcap.bysector*
Banks 51.0%
Fuel&Power 13.8%
Pharmaceuticals 11.6%
Insurance 5.5%
Cement 5.1%
Miscellaneous 3.0%
Engineering 2.4%
Foods 2.1%
Textile 1.9%
Service&RealEstate 1.2%
Tannery 1.2%
Ceramics 0.7%
IT 0.5%
Paper&Printing 0.1%
Jute 0.03%
Total 100%*AsofNovember ,2008
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EconomicNewsEconomicNewsEconomicNewsEconomicNewsUSDUSDUSDUSD9b9b9b9bnnnnremittancein2008remittancein2008remittancein2008remittancein2008TheDailyStar,FridayJanuary2nd,2009
2008 saw a record number of over 875,000Bangladeshisgoingoverseasforemploymentcomparedtoabout832,000peoplein2007.ThecountryalsoreceivedarecordamountofapproximatelyUS$9bninremittancesin2008.http://www.thedailystar.net/story.php?nid=69632EbbinginflationmarksyearEbbinginflationmarksyearEbbinginflationmarksyearEbbinginflationmarksyear----endendendendTheDailyStar,ThursdayJanuary1st,2009
Inflation droppedsignificantlyat theend of2008, althoughcommodityprices,especiallyoffooditemsincludingrice,arestillhigh.GDP growth is expected to decline this year due to theongoing global economic recession despite the economyhaving grown at a reasonable pace for the past several
years,Inflationhasbeenincreasingforthepastfewyears,crossing11% on a point- to-point basis in 2008. However, inNovember2008 inflation came downto 6.12%.Economistsexpectit todropfurtherin thecomingdays.Butcommoditypricesstillremainaconcern.Multilateral donor agencies are predicting GDP growth toslow to 5.5% in 2008 or even 4.8% in the worst casescenario, although thegovernment claims growthcould bestillbeataround6%.TheADP(annualdevelopmentprogramme)implementationratehasnotbeenveryimpressiveduringthefirstfivemonthsofFY2009withonly18%oftheADPimplemented.
However, the country's export and remittance inflowcontinues to be healthy despite the global f inancialmeltdown.Exportsgrewby30.7%whileremittancegrewby33.6%duringthefirstfourmonthsofFY09.http://www.thedailystar.net/story.php?nid=69509Economyridespaststrong2008Economyridespaststrong2008Economyridespaststrong2008Economyridespaststrong2008TheDailyStar,ThursdayJanuary1st,2009
The economy remained resilient in 2008 despite anunfavourable domestic investment climate and thesurroundingglobaleconomicmeltdown.Economicindicatorssuchasprivate-sectorcreditgrowth,call
money rate, foreign currency, foreign exchange reserves,inflation,exports,importandremittances,wereallpositivein2008.Bangladeshs credit market remained unaffected by theglobal financialcrisis- private-sectorcreditgrewmore than26%in2008.Domestic credit recorded an increase of BDT 174,130mn(USD2527mn)or7%duringQ1FY09comparedtoariseof
BDT100,070mn(USD1452mn)or4.9%ayearago.Theriseindomesticcreditduringtheperiodwasduetoasignificantrise in private-sector credit, by BDT 103,700nm (USD1505mn)or5.5%,accordingtoBangladeshBankdata.Thetaka remained generallystableat68.50-69.50againstthe USD throughout the year. However, the euro and thepoundwereextremelyvolatileagainstthetakain2008.Theeurowent upto 111 against the taka in the mid-July anddeclinedaslowas88inNovemberbeforebouncingbackto100.Thepoundwentupto141againstthetakainMarchbutdeclinedto103inNovember.Importgrowthwas25.6%duringFY09againstexportgrowthof 15.7%; however, remittance inflow increased by 32%easing pressures on the balance of payments. ExportsreceiptsinQ1FY09increasedby30.7%toUSD5,251.5mnfromUSD 4,018.7mn inQ1FY09. Import payments inQ1FY09 rose by 34.9% to USD 6,324.7mn from USD4,687.5mninQ1FY08.GrossforeignexchangereservesstoodatUSD5,245.4mnatthe endofNovember2008compared toUSD5,095.3mnayearago.Theinflationrateonapoint-to-pointbasisalsodecreasedto6.12% inNovember 2008 from7.26% thepreviousmonth.Thelocalmoneymarketexperiencedsomevolatilityin2008.The market remained calm in 2007, due to the surplusliquidityin thesystem.Call rateshoveredbetween7%and15%in2008,comparedtobetween6.5%and9.5%in2007.http://www.thedailystar.net/story.php?nid=69467
TakadepreciatesagainstUSdollarmarginallyagaTakadepreciatesagainstUSdollarmarginallyagaTakadepreciatesagainstUSdollarmarginallyagaTakadepreciatesagainstUSdollarmarginallyagaininininTheFinancialExpress,WednesdayDecember31st,2008
Bangladesh taka (BDT) was depreciated marginally by
0.04%against the US dollar on Tuesday,the last workingdayofcalendaryear2008,followingariseindemandforthegreenbackinthemarket.US dollar traded at BDT 68.95 in the foreign exchangemarket on the day against BDT 68.92 on the previousworkingday.In2008,BDTwasdepreciatedmarginallyby0.54%againsttheUSdollarmainlyduetoashortsupplyofthegreenbackintheinter-bankforeignexchangemarket.Compared to theprevious fouryears, BDT/USD exchangeratewasfairlystablein2008,accordingtoCitibanksrecentlypublishedannualmarketupdate2008.
http://www.thefinancialexpress-bd.info/search_index.php?page=detail_news&news_id=54632
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AgricultureAgricultureAgricultureAgricultureLowwholesalepriceLowwholesalepriceLowwholesalepriceLowwholesalepriceofedibleoilyettoimpactofedibleoilyettoimpactofedibleoilyettoimpactofedibleoilyettoimpactretailmarketretailmarketretailmarketretailmarketTheDailyStar,Friday,January2,2008
Althoughpricesofdifferenttypesofedibleoilhavedeclinedinthewholesalemarket,itisyettohaveanyimpactontheretailmarket.Price of palmoil wentup byBDT100(USD1.45)andwassellingatBDT1,700(USD24.37)amaund,whereas the wholesale price of non-branded edible oilincludingsoyabeanandsuperpalmoildeclinedbyBDT200(USD 2.9) to BDT 700 (USD10.1) per maund (37.32 Kg)withinaweekduetoanincreaseinsupplyandasharpfallinpricesin theinternationalmarket.Butpricedeclinesareyettohaveanyimpactonretailmarketsastradersweresellingfromoldstocks,accordingtowholesalers.http://www.thedailystar.net/story.php?nid=69631Fertilizer pricehike hamperspotato production in NFertilizer price hikehamperspotato production in NFertilizer pricehike hamperspotato production in NFertilizer price hikehamperspotato production in Northernorthernorthernorthern
distdistdistdistrictrictrictrictssssTheFinancialExpress,Thursday,January1,2008PotatogrowersofNortherndistricts (Rangpur andDinajpurregion) fearthatif pricesoffertilizerscontinue toincrease,potatocultivationwillbebadlyaffected.AtpresentasackofTrippleSuperPhosphate(TSP)is beingsold atBDT3,800(USD55.1)upfromBDT1,800(USD26.1);asackofMuriateofPotash(MOP)issoldatBDT2,200(USD31.9)upfromBDT1,000(USD14.5)previously.Asackofureafertilizerisbeing sold at BDT 600 (USD8.7) upfromBDT 300 (USD4.3).Thuspoorfarmersarebeingcompelledtouselessthanthe necessary quantity of fertilizers. The Department ofAgricultureExtension (DAE) sourcessaid potatocultivationtarget had been fixedat 176,900 hectares of land ineightdistrictsofgreaterRangpur,Dinajpurregionwithproduction
targetof3,007,300MT.Sourcesalsosaidthatanumberoftraders,takingadvantageofthehigherdemandforfertilizers,havebeensellingsub-standardfertilizersatcheaperrates.http://www.thefinancialexpress-bd.info/search_index.php?page=detail_news&news_id=54738GrapeGrapeGrapeGrape cultivation gains popularity in Ncultivation gains popularity in Ncultivation gains popularity in Ncultivation gains popularity in Northernorthernorthernorthern regionregionregionregion ofofofofBangladeshBangladeshBangladeshBangladeshTheFinancialExpress,Wednesday,December31,2008Grapecultivationisbecomingpopularinthenorthernregionof Bangladesh, as growers are earning good profits.According toagriculturists, the soilandclimateofDinajpur,Rangpur, Thakurgaon and Panchagarh
1 are suitable for
grapecultivation.Presently,grapesarebeingcultivatedona
limitedscale due to inadequate supply ofseeds andotherfacilities. According to local growers,proper training alongwithfinancialandtechnicalassistancecanpavethewayforlarge-scale commercial production of grapes across thenorthernregion. Mostofthegrapesproducedin theareasarein themoderategradevarietycalled'Jatka'.Theyalsocultivateanumberofhigh-gradevarietieslikeBlackRuby,
1AreasintheNorthernregionofBangladesh
Cardinal, Pearl, Blue etc. These local grapes arecomparativelysweeterintastethantheimportedones.http://www.thefinancialexpress-bd.com/2008/12/31/54641.html
AgricAgricAgricAgricreditdisbursementposts27.2reditdisbursementposts27.2reditdisbursementposts27.2reditdisbursementposts27.2%%%%growthgrowthgrowthgrowthininininJulJulJulJul----NovNovNovNovTheFinancialExpress,Monday,December29,2008Agriculturalcreditdisbursementrecordedarobustgrowthof27.2%inthefirstfivemonthsofthecurrentfiscalyear.Eightstate-owned banks and financial institutions along withprivate commercial banks (PCBs) disbursed BDT 33.77bn(USD493mn)asagricreditduringtheJuly-NovemberperiodofFY09 compared toBDT26.55bn(USD387.5mn)duringthecorrespondingperiodofFY08,accordingtothecentralbankstatistics.Theloanshavebeengiventoeightagro-basedsub-sectorssuch as crops, irrigation equipment, livestock, agriculturalproducts marketing, and fisheries. Banks and financial
institutionshaveachieved36.02%oftheirannualagricreditdisbursement target, which has been fixed at BDT 94bn(USD1.37bn).http://www.thefinancialexpress-bd.com/2008/12/29/54469.htmlAviationAviationAviationAviationBimanbackintheblackafterfouryearsBimanbackintheblackafterfouryearsBimanbackintheblackafterfouryearsBimanbackintheblackafterfouryearsTheDailyStar,SundayJanuary04,2009
Biman Bangladesh Airlines returned to the black in fiscalyear 2007-08withaBDT190mn(USD2.75mn) profit afterfour years, as thenational flagcarrier improvedits overallefficiency in maintaining routes and flight schedule, andstopping pilferage. The carrier has incurred losses from
2004, mainly due tomismanagement, corruption and fuel-guzzlinganddecade-oldaircrafts.Profitsincreasedduetoanimprovement in efficiency in route planning, such as flightreduction on routes, temporary suspension of flights onunprofitable routes and flight schedule maintenance.Reduction in maintenance costs and an overall return ofdiscipline to the Biman administration also contributed toprofitability.
http://www.thedailystar.net/newDesign/news-details.php?nid=69956
SSSSectorNewsectorNewsectorNewsectorNews
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GMGaddsaircrafttofleetGMGaddsaircrafttofleetGMGaddsaircrafttofleetGMGaddsaircrafttofleetTheDailyStar,SundayJanuary04,2009
GMGAirlinesyesterdayaddedanMD-83aircrafttoitsfleet,totalingitsnumberofplanestosix.ShahabSattar,managingdirectorofGMG,saidtheMD-83aircraft with 150-passenger seating capacity and powerfulengines,wouldhelpopennewroutesfortheprivateairline.The airlines destinations include Singapore, Bangkok,KarachiandDubai.http://www.thedailystar.net/newDesign/news-details.php?nid=69930BankingBankingBankingBankingMeltdownMeltdownMeltdownMeltdownexpectedexpectedexpectedexpectedtoreducecentralbank'sprofittoreducecentralbank'sprofittoreducecentralbank'sprofittoreducecentralbank'sprofitTheFinancialExpress,SundayJanuary4th,2009
According to Bangladesh Bank (BB) officials, the globalfinancialmeltdown hasaffected thecentral bank's income,followingthewithdrawalofitsinvestmentsfrominternationalbanks.
"Almost90%of thebank's investmentshave alreadybeenwithdrawn from international banks," statedBBs executivedirector,YasinAli.TheBBearneda recordprofitofBDT25bn(USD362.8mn)inFY08,andmorethan72%oftheearningwasgiventothegovernmentexchequer."ButtheBBincomefrom investmentsin foreignbanksandfinancialinstitutionshasbecomealmostnilafterthosewerewithdrawn following the onslaught of the global financialcrisis,"saidtheofficial.ManyUSandEuropeanbankshavealreadybeenhitbytheworstglobalrecessionsincethe1930s.
Credit ratingsagencyStandard&Poor's lastweekslashedthe ratings on 11 U.S. and European banks and cut theoutlook of another bank due the meltdown, according toBloomberg.ItcutratingsforBankofAmerica,BarclaysBank,Citibank,Credit Suisse,DeutscheBank,Goldman Sachs, JPMorganChaseBank,MorganStanley,RoyalBankofScotland,UBSandWellsFargoBank.HSBCBank'soutlookwasrevisedtonegative,thoughitsratingremainedunchanged.Amidsucha gloomy scenario intheUSand Europe, the BBofficialsstated that the central bank was forced to withdraw itsinvestmentsfromtheleadinginternationalinvestmentbanks.http://www.thefinancialexpress-bd.info/2009/01/04/55055.html
PCBspostriseinprofitPCBspostriseinprofitPCBspostriseinprofitPCBspostriseinprofitTheDailyStar,FridayJanuary2nd,2009
Private commercial banks (PCBs) performed well in 2008despiteaglobalanddomesticslowdowninbusinessactivity,according to data received from different PCBs. Profits ofPCBs rose considerably in 2008 - the highest increase inoperatingprofitswas97%,whilethelowestwas23%.Accordingtobankers,profitsincreasedin2008duetoariseinpricesofcommodities.
TheoperatingprofitofAl-ArafahIslamiBankroseby97.5%to BDT1580mn (USD 22.9mn) in 2008 from BDT 800mn(USD11.6mn)in2007.In2008profitsofShahjalalBankandIslami Bank increased by 57% and 55%, respectively.NationalCreditandCommerceBankrecordeda33%riseinoperatingprofittoBDT2360mn(USD34.25mn)in2008froma year ago. Profits of UCB and NBL, two first-generationPCBs,grewby24%and28%,respectively,in2008.In2008operating profits of BRAC Bank, a third-generation privatebank, also increased by over 23% toBDT 2000mn (USD29mn).PrimeBank'soperatingprofitsoaredtoBDT4100mn(USD59.5mn)in2008fromBDT3260mn(USD47.3mn)in2007.Southeast Bank posted BDT 3000mn (USD 43.54mn) inoperating profit, up fromBD 2910 (USD 42.2mn) in 2007.EXIMearnedBDT2600mn(USD37.73),DhakaBankBDT2540mn(USD36.86mn),Dutch-BanglaBDT2210mn (USD32.07), Mercantile BDT 1900mn (27.57mn), IFIC BDT1770mn (USD 25.69), Basic BDT 1750mn (USD 25.39),Standard Bank BDT 1560mn (USD 22.64mn), Trust BankBDT 1380mn (USD 20mn), Jamuna Bank BDT 1200mn(USD 17.41mn),OneBankBDT1100mn (USD 15.96)andSocial Investment Bank BDT 1000mn (USD 14.51mn).ABBank'soperatingprofithoweverdeclinedbyBDT150mn(USD 2.17mn) to BDT 4500mn (USD 65mn) in 2008.The operating profit of PCBs increased by nearly BDT1,5000mn(USD21.8mn)toBDT5,2000mn(USD754.7mn)in2007.http://www.thedailystar.net/story.php?nid=69626
IBBLdepositreIBBLdepositreIBBLdepositreIBBLdepositrecords21pc,remittance67percentgrowthcords21pc,remittance67percentgrowthcords21pc,remittance67percentgrowthcords21pc,remittance67percentgrowthTheFinancialExpress,FridayJanuary2nd,2009
ThetotaldepositofIslamiBankBangladeshLimitedreachedBDT201.1bn(USD2.91bn)attheendof2008,growingby21%fromayearago.In2008thebankstotalinvestmentwasBDT198.7bn(USD2.87bn),growingby14%from2007.ThelargestprivatecommercialbankhandledBDT402.7bn(USD5.85bn)worthofforeigntradein2008(anincreaseof40% since 2007); this included import income of BDT168.3bn(USD2.43bn)(rose23%), exportearningsofBDT93.96bn(USD1.36bn)(rose41%)andremittanceincomeofBDT140.4bn(USD2bn)(rose67%).http://www.thefinancialexpress-bd.info/search_index.php?page=detail_news&news_id=54854
BaselBaselBaselBasel----IIcomesintoeffecttodaytoconsolidatecapitalbaseIIcomesintoeffecttodaytoconsolidatecapitalbaseIIcomesintoeffecttodaytoconsolidatecapitalbaseIIcomesintoeffecttodaytoconsolidatecapitalbaseofbanksofbanksofbanksofbanksTheFinancialExpress,ThursdayJanuary1st,2009TheBasel-IIaccordwillcomeintoeffectinBangladeshfromtoday(Thursday)alongsidetheBasel-Itoconsolidatecapitalbaseofbanks.ThebankswillbeallowedtofollowbothBasel-IIandBasel-Iframeworksfor2009tocalculatetheircapitaladequacy.ButthebankswillhavetoimplementtheBasel-IIframeworkfrom
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January2010.aseniorofficialofBangladeshBank(BB)toldtheFE.Thecentral bank issued guidelines on 'Risk-based CapitalAdequacy for Banks' on Wednesday aiming to startimplementation of the Basel-II framework in the country'sbankingsystem.The new Baselaccordhas beenprepared onthe basisofthree pillars: minimum capital requirement, supervisoryreviewprocessandmarketdiscipline.Threetypesofrisks--creditrisk,marketriskandoperationalrisk -- have to be considered under the minimum capitalrequirement.AstudycarriedoutbylocalbankssuggestedthattheBasel-IIshould initially be implemented with three specificapproaches - a standardizedapproach for calculating riskweighted assets (RWA) against credit risk, a standardized(rule-based) approach for calculating RAW against marketrisk, and a basic indicator approach for calculating RWAagainstoperationalrisk.Creditratingistobedeterminedonthebasisofriskprofileassessed by the External Credit Assessment Institutions(ECAIs),accordingtothestandardizedapproachoftherisk-based capital adequacy framework of the Basel-II.Thecentralbankearlierissuedguidelinesfor recognitionofeligibleECAIstoassesscreditrisksinlinewiththeBasel-IIframework.Currently, two local credit rating agencies - Credit RatingInformationandServicesLimited(CRISL)andCreditRatingAgency of Bangladesh (CRAB) - are operating inBangladesh.Thecentralbank hasalready increased theamountof the
requiredminimumcapital for commercial banks to 10%oftheirrisk-weightedassetsfrom9.0%toconsolidateitscapitalbase, aiming to implement the Basel-II framework.Bangladesh is now following Basel-I framework for thebanks' capital adequacy requirement. Risk-based capitalratiowas8.0%whenit wasfirstadopted in1996. In2002,theratiowasincreasedto9.0%.
http://www.thefinancialexpress-bd.info/search_index.php?page=detail_news&news_id=54730HealthcareHealthcareHealthcareHealthcareNatNatNatNationalionalionalionalguidelineformanagementofmalnourishedchildrenguidelineformanagementofmalnourishedchildrenguidelineformanagementofmalnourishedchildrenguidelineformanagementofmalnourishedchildrenlaunchedlaunchedlaunchedlaunchedTheDailyStar,SundayDecember31,2008
AnationalguidelinepreparedbytheInstituteofPublicHealthand Nutrition (IPHN) for management of severelymalnourished chi ldren was launched on the 30
th of
December. Speaking at the launching ceremony, HealthAdviserAMMShawkatAlisuggestedpublishingtheBengaliversion of the guideline so that common people canunderstand it easily. The guideline has been prepared bylocalconsultantsandisapplicableforunderweightchildren
and will be useful for all government and non-governmenthospitals.http://www.thedailystar.net/newDesign/news-details.php?nid=69441IIIInfrastructure&Energynfrastructure&Energynfrastructure&Energynfrastructure&EnergyPowerdistributioncoPowerdistributioncoPowerdistributioncoPowerdistributioncompaniempaniempaniempaniesproposetariffhikesproposetariffhikesproposetariffhikesproposetariffhikeTheDailyStar,FridayJanuary2,2009
DhakaPowerDistributionCompanyLtd(DPDC),WestZonePower Distribution Company Ltd (WZPDC) and DhakaElectricSupplyCompanyLtd(DESCO)haveproposedtariffhikesattheconsumerlevel,of14.77%,15.18%and14.77%respectively. The Bangladesh Energy RegulatoryCommission(BERC)consideredtheproposalsanddecidedtoholdopenmeetingsindividuallywiththecompanies.TheRuralElectrificationBoard(REB)has alsosubmittedaproposal for a tariff increase of 11.52% at the subscriberlevel.ButtheBERCfoundtheproposaltobeincompleteandaskedforanewproposalfromtheREB.http://www.thedailystar.net/story.php?nid=69674
GTCLearnsBDT2.73bn(USD39.65mn)aspreGTCLearnsBDT2.73bn(USD39.65mn)aspreGTCLearnsBDT2.73bn(USD39.65mn)aspreGTCLearnsBDT2.73bn(USD39.65mn)aspre----taxprofitintaxprofitintaxprofitintaxprofitinFYFYFYFY08080808TheFinancialExpress,TuesdayDecember30,2008
Gas Transmission Company Limited (GTCL) earned BDT2.73bn (USD 39.65mn) as pre-tax profit in FY 08. ThecompanyearnedBDT4.17bn(USD60.57mn)onaccountoftransportofgasandcondensatewhich isup18.3%fromayearago.http://www.thefinancialexpress-bd.com/search_index.php?page=detail_news&news_id=54530IndianshipsleaveBangladeshwatersIndianshipsleaveBangladeshwatersIndianshipsleaveBangladeshwatersIndianshipsleaveBangladeshwatersTheDailyStar,SundayDecember28,2008
TensionoverIndia'strespassing intoBangladeshimaritimeboundarymitigatedonDecember27asthethreeIndianoiland gas survey ships withdrew from Bangladeshi waters.Navysourcessaidimmediatelyafterthesurveyshipsleft,anIndian coastguard vessel went to the spot and asked theBangladeshioffshore patrol vesselsthereto leave thespotclaiming it to be Indian waters. Foreign Secretary TouhidHossain, who lodged the formal government protest, saidthat the Indian high commission was asked to stop anysurveyordevelopmentactivitiesandremovetheshipsfromtheareauntildisputesregardingthemaritimeboundaryaresettledby "mutualagreement".The Indianenvoy proposedthatBangladeshsendatechnicalteamtoIndiaassoonaspossibletodiscussthemaritime issueas thetwocountriesstarted talks on delimitation of the maritime boundary in
September2008afteralapseof22years.The location is seven miles into Bangladeshi maritimeboundary, which is also situated within Bangladeshi deep-seaoilandgasexplorationBlock-14.http://www.thedailystar.net/story.php?nid=69074
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PharmaceuticalsPharmaceuticalsPharmaceuticalsPharmaceuticalsAristopharmatoaddAristopharmatoaddAristopharmatoaddAristopharmatoadd3moreexportdestinationsin203moreexportdestinationsin203moreexportdestinationsin203moreexportdestinationsin2009090909TheFinancialExpress,Sunday,December28,2008One of the leading pharmaceuticals manufacturers,Aristopharma, has set a sales target of BDT 3bn (USD43.8mn) for 2009,as the local drugmanufacturer aims to
strengthen its position among the top 10 players in thecountry.Thecompanywouldlike toadd threemore exportdestinations,namely,Malaysia,LebanonandNigeria toitscurrentlistofnineexportcountries.This year, the company became the first pharmaceuticalmanufacturer in Bangladesh to conduct bio-equivalenceresearchfor itsmedicine. Thecompany hasintroduced30new products in themarket,and has grownbymore than20%,whichisalmosttwiceasmuchastheoverallgrowthofthis industry in the country.Aristopharmas currentmarketshareisabout5.2%,andthecompanyaimstoestablishitselfasoneofthetopfiveplayersbytheendof2009.http://www.thefinancialexpress-bd.com/2008/12/28/54352.html
TeTeTeTelecomslecomslecomslecomsGGGGrameenphonerameenphonerameenphonerameenphonetointroduceBillPaytointroduceBillPaytointroduceBillPaytointroduceBillPayforDESCOsubscribersforDESCOsubscribersforDESCOsubscribersforDESCOsubscriberssoonsoonsoonsoonTheFinancialExpress,Tuesday,December30,2008All subscribers of the Dhaka Electric Supply Company(DESCO)willsoon beableto pay their electric billseitherfrom their Grameenphone (GP) handset or from any GP-authorizedBillPayoutletsatanytimefromanylocation.Earlier this year,GPwon thecontract throughan open bidinitiated by the DESCO. The service aims to removeconsumers'hasslesassociatedwithstandinginlongqueues,travelling, limitedpaymenthoursand variouspost paymentharassment. In the initial phase, DESCO consumers will
enjoyeasyaccesstoBillPayoutletsatconvenientlocations.Consumers with mobile phones will get an immediateconfirmationofbillpaymentfromDESCOwhenbillsarepaid.Customers will also be able to make queries regardingpresent and past bill status via SMS or can receiveassistance fromGP's BillPay helpdesk. DESCO will enjoyfully automated reconciliation processes, reduced timebetweenbillreceiptandposting-resultinginfasteravailablefunds as well as improved cash-flows and reduction ofmanualprocessingcostsanderrors.http://www.thefinancialexpress-bd.com/2008/12/30/54540.htmlTextilesTextilesTextilesTextilesBGMEAcallsforreBGMEAcallsforreBGMEAcallsforreBGMEAcallsforreducingChittagongducingChittagongducingChittagongducingChittagongportservicechargesportservicechargesportservicechargesportservicecharges
TheFinancialExpress,Tuesday,December30,2008The Bangladesh Garments Manufactures and Exporters'Association(BGMEA)hasaskedforareductioninchargesfor different services offered by the ChittagongPort (CP).The Chittagong Port Authority (CPA) raised different portchargeslast June, resultingin increased garments ownersexpensesforexportingtheirproducts.Freight chargesof 20feet containers rose toUSD6 fromUSD1.5andthatof40feetcontainerswasre-fixedatUSD
12 from USD 3. The charge for importing goods wasincreased toBDT816 (USD11.9) fromBDT408 (USD6)export charges roseto BDT 368 (USD5.4) fromBDT184(USD2.7).http://www.thefinancialexpress-bd.com/2008/12/30/54533.htmlIndiancoIndiancoIndiancoIndiancompanytompanytompanytompanytoinvestUSD5.86investUSD5.86investUSD5.86investUSD5.86mmmmnnnnininininKarnaphuliKarnaphuliKarnaphuliKarnaphuli
2222EPZEPZEPZEPZTheFinancialExpress,Tuesday,December30,2008AnIndiancompanywillsetupaknitgarmentsmanufacturingfactoryintheKarnaphuliExportProcessingZone(EPZ).M/sWhite House Clothing BD (Pvt) Limited, a 100% Indiancompany, will invest USD 5.86mn in the project. Thecompany will create employment opportunity for 1,203people,including24foreignnationals.http://www.thefinancialexpress-bd.com/2008/12/30/54546.htmlExportgrowthofwovenExportgrowthofwovenExportgrowthofwovenExportgrowthofwovensubsubsubsub----sectorsectorsectorsectordeclinesdeclinesdeclinesdeclinesTheFinancialExpress,Monday,December29,2008The country's apparel sector, especially the woven sub-sector,sufferedslightlyinNovember2008,asimportbythe
foreigncountriesdeclinedduetotheongoingfinancialcrisis.Accordingtoindustryinsiders,theindustryisnowwaitingfororders to be negotiated in January-February when retailstores will reopen in foreign countries after the Christmasandyear-end sales. Theflow ofnew orderswilldeterminewhetherthelocaltextilessectorremainssafeinfaceoftheglobalfinancialturmoil.http://www.thefinancialexpress-bd.com/2008/12/29/54432.htmlTTTTourismourismourismourismSearchforSheratonoperatorhitssnagsSearchforSheratonoperatorhitssnagsSearchforSheratonoperatorhitssnagsSearchforSheratonoperatorhitssnagsTheDailyStar,SundayJanuary04,2009
Thegovernment'ssearchforanewcompanytooperateandmanageDhakaSheratonHotelisbeinghelduptemporarily.Thehotel requires a one-year closure,whichmeans profitloss for the government and temporary job losses for thehotel's600employees.ThegovernmentcontinuestalkswithRamadaPlaza,athree-starhotelofUS-based internationalchain Wyndham Worldwide, and Marriott International. AMarriottteamis expected toarrive inDhakabythe endofthisweek fornegotiations.The government hasbargainedwith atleastseven internationalhotelchainsin thelastsixmonthsmainlyonrenovatingSheratonwithoutclosingit.ThecostofrenovationswillbearoundUSD20mn.In November, Starwood, the management company ofDhakaSheraton,extendeditscontractwiththegovernmenttillMarch31.Starwood's25-yeardealexpiredonDecember
31.SheratonmadeanoperatingprofitofUSD4.16mnlastyearand forecasts 10% profit growth this year, according toTrevorMacDonald,generalmanagerofDhakaSheraton.http://www.thedailystar.net/newDesign/news-details.php?nid=69959
2OneofthetopEPZsatChittagong
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